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- FOR IMMEDIATE RELEASE
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- ON-LINE BANKING / AMEX TESTING ELECTRONIC
PURCHASING SPECIFICATIONS FOR THE NET
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- American Banker, May 1997, by Drew Clark
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- American Banker via Individual Inc. : Companies
wanting to conduct
- business-to-business commerce over the Internet may
benefit from a set of electronic purchasing
specifications being tested by American Express Co.
Called Open Buying on the Internet, or OBI, the proposed
standard is aimed at igniting in area of electronic
commerce that many view as ready for an explosion.
- "The research we conducted clearly confirms the view
that the business- to- business segment represents the
greatest promise for Internet commerce," said Thayer
Stewart, vice president of marketing for American Express
corporate services. Many companies already have the
computer infrastructure needed for electronic exchanges,
Mr. Stewart said. They are being driven to make use of
that infrastructure by a desire for lower operating
costs, he said. Though the largest companies typically
use electronic data interchange to streamline the
exchange of purchase orders and other documentation, such
transactions are expensive to support because they
require proprietary connections between buyers and
sellers.
- The American Express standard could give them a
lower-cost option. "There have been lots of structured
data formats between buyers and sellers," said Paula L.
Cappello, director of marketing for Actra Business
Systems, a joint venture of Netscape Communications Corp.
and GE Information Systems Inc., which supports OBI. "OBI
provides an Internet-based system that allows us to
interoperate our program in non-Actra environments," said
Ms. Cappello.
- Other technology companies supporting OBI are
Microsoft Corp., Oracle Corp.,
- Intelisys Electronic Commerce, and Open Market Inc.
"Although OBI is not really high-technology, it does help
simplify messaging from one system to another," said
- Jonathan Weinstein, group product manager for
Internet commerce at Microsoft.
- Because OBI does not require the simultaneous
transmittal of financial information, the protocol is
designed to complement, not compete with, the Secure
Electronic Transaction standard put forth by MasterCard
and Visa, said Mr. Stewart.
- American Express' reason for getting behind OBI are
clear. "They want to facilitate the payment," said Gary
Craft, an analyst at Robertson, Stephens & Co. in San
Francisco. "This is where American Express makes their
money." "You are going to see the business-to-business
market drive the adopting of smart cards. And there is a
lot of value in controlling the real estate on the card,"
Mr. Craft said.
- OBI grew out of an experiment done early last year at
the Massachusetts Institute of Technology with VWR
Scientific Products and Office Depot. Led by American
Express, about 25 Fortune 500 companies teamed up last
fall to create the Internet Purchasing Roundtable, a
group that set the requirements for the newly named OBI.
The list of commercial suppliers grew to include
Corporate Express, Olsten Corp., and W.W. Grainger. The
list of corporations on the buying site includes Apple
Computer, BASF Corp., Ford Motor, General Electric, and
National Semiconductor.
- Copyright, 1997, American Banker
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